China will soon release a policy that will limit foreigners and people from Hong Kong, Macau or Taiwan from buying homes on the mainland to curb the speculation in the over-heated property market, China Business News reported today.
A non-citizen must first get an approval to buy a mainland property, and then they must register the purchase, the news report said. It will even stipulate that they can buy only one or two residential properties, and the units cannot be transacted in a certain period of time after purchase, the news report said.
The policy, an administrative regulation, "will be effective almost instantaneous versus the pace of financial or taxation changes," the official told the newspaper yesterday.
China eliminated the different treatments between local and non-local purchasers of real estate in 2002, making China among the few countries in the 187 members of the International Monetary Fund who pose no limits on investments in real estate.
Overseas institutional investors have purchased a large number of property projects in Shanghai, Beijing and Guangzhou this year, which has contributed to the soaring housing prices, previous news reports said.
In 2005 alone, foreign investors bought properties in China worth at least US$3.4 billion, with US$5.4 billion being co-invested into housing projects.
(Shanghai Daily July 6, 2006)